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Showing posts from May, 2020

Liability of Government in Contract - Administrative Law

Introduction In this post we will cover contractual liability of government. We will mainly deal with below things: Constitutional Provision for Contracts by Government (Article 298, 299) Elements of valid contract and it's effect Ratification of Invalid contracts Liability of government Who is liable? Extent of liability? Judicial intervention into contracts by government. Quasi Contractual Liability Applicability of Section 65 of Contracts Act Constitutional provisions related to contract Article 298 and 299 deals with Contracts by government. Article 298 This articles confers powers on government to carry on business or trade. Its states that government can form business entities, acquire a property and dispose a property. Government can also enter into contracts with other parties. Article 299 This articles states how the contracts are entered by governments. It provides that contracts are to be made on behalf of President or Governor. It also states that all contracts should b...

Privileges and Immunities to Administration in Suits

Introduction You know government can enter into contracts. Government can start some business. It mean government can sue other people, or you can sue the government. Before you initiate a legal proceedings against government, or even after legal proceedings are initiated, there are some relaxations to government.( OK, we will use Government/Administration as per our discretion interchangeably in this post, but they will mean the same ). So, it might happen that to prove something you may need a document or evidence, but government may be given exemption to produce evidence in that regard. Let's take one example.  General law is that burden of proof is on prosecution. Meaning, the one who accuses other  needs to prove the crime/offence by other. But when government accuses you of Sedition, you have to prove your innocence, burden of proof is on YOU. This is scary, as many times government in power just accuses people of sedition who opposes their ideas/policies, and put oppone...

Meaning of Delegated Legislation, Types of Delegated Legislation, Control of Delegated Legislation

Introduction In this post, we will cover below things What is delegated legislation ? Why do we need delegated legislation ? Growth of delegated legislation What is the problem with delegated legislation ? Types of Delegated Legislation What CAN and what CANNOT be delegated ? Control of delegated legislation What is delegated legislation ? Parliament or Senate are primarily responsible for formulation of law. We call them legislature . In India, at central level Parliament is body who makes a law. It consist of MPs(Lok Sabha, Rajya Sabha). At state level we have Legislative Assembly (Vidhan Sabha) and Member of Legislative Assembly makes a Laws. After Law making comes the executives . They are responsible for executing the Laws. Generally President/Prime Minster is head of executive body. Ministers are also executive. Their main purpose is to execute the law. There is separation of power. Legislature will make the law, Executives will executes the law. Sometimes. for various practical ...

Parliamentary and Judicial Control over delegated legislature

Introduction In previous post, we have discussed about delegated legislation, it's types, what all things can be delegated, what cannot be delegate etc. We have also seen that these delegated legislation are necessary evil. There are chances that administrative authorities could abuse the power (They will definitely do) and hence safeguards are needed to control over delegated legislation. We will cover 3 types of control over delegated legislation Procedural Parliamentary Judicial Procedural Control over delegated legislation When the power is delegated to executives, legislature can prescribe the procedure in which executives should use his delegated power. Procedure prescribed can help control the abuse of power by executives or administrative authorities. Procedure for consulting with affected parties For example, procedure can state that administrative authority should consult with all stakeholders before making rules, ordinance or other delegated legislation. For exam...

Compulsory Winding up of Company by Tribunal and Grounds for Winding up

Introduction This post will cover below things: What is winding up Modes of winding up Compulsory winding up by Tribunal Voluntary winding up by Members and Creditor ( This is discussed here ) Grounds for Winding up by Tribunal Consequences of Winding up order Conclusion Winding up by Tribunal and voluntary winding up by Members and Creditors are discussed in two different posts. This post will confine to winding up by Tribunal What is winding up ? It's in short a legal process which will put an end to corporate personality. It's a process whereby the existing company's affair are brought to an end. It is complex situation (And sad also) where the company which came into existence with aspiration to grow higher with passage of each day but turn off their entire business either voluntarily or by the tribunal's involvement. It's process by which the properties of the companies are administered (and finally sold) for the benefits of it's members and creditors. The ...

Voluntary winding up of company by member and creditors

Introduction In this post we have discussed winding up by tribunal. Here we will discuss the winding up of company by creditor and members. Objective outline for this post is as below(Two points about liquidator is common for both type of voluntary winding up) : Circumstances under which voluntary winding up carried out Voluntary winding up by members Declaration of solvency General procedure Appointment/Removal of liquidator Voluntary winding up by Creditors Meeting of creditor Publication or resolution Appointment of liquidator by creditor Consequences of appointment of liquidator Power/Duties of liquidator The End of Company-Section 318 Before going into winding process, let us understand the difference between winding process and dissolution of company. Winding up is the process to sell off stock, pay off creditors, and distribute any remaining assets to partners or shareholders. It's process to realize the assets and distribute that to all the stakeholders. Dissolution is gene...

Companies Act- Accounts of Company (Section 128 and Companies Account Rules 2014)

Introduction In this post we will be covering below things. What is the need to maintain accounts? What are the provisions related to accounts in Company Act,2013? General Provision Books of Accounts meaning Relevant books and Paper Meaning Place of books of account Who will maintain the books of accounts? Penalty provision Companies Account Rules, 2014 What is the need to maintain accounts Ooh. Largest corporate scandals from Lehman Brothers, to Satyam to ILFS, ALL of them involved manipulation of accounts. Transparent account is crucial for better corporate governance. In Company, ownership and management is different. Management runs the company therefore there should be something that should help ownership to know about current position or other information about company. That something is books of accounts, reports, document etc. In short, to inform ownership about current affairs of company, accounts should be maintained. Provision in Companies Act, 2013 (Section 128) Section 128...

Initiation of Insolvency Resolution process against Corporate Debtor in Insolvency and Bankruptcy Code, 2016

Introduction Insolvency resolution process may be initiated when Company defaults on it's financial obligation. Section 6-11 of Insolvency and Bankruptcy Code(Hereinafter referred as IBC) deals with how to start such process against a Company who defaults on loan. IBC answers details such as who can initiate insolvency resolution process ? What all details needs to be submitted with application for such process ? Who all cannot initiate such process. We will discuss these things under following headings Who can initiate corporate insolvency resolution process ? Initiation by Financial Creditor Initiation by Operational Creditor Initiation by Corporate Applicant (Company itself) Who cannot make application for initiation of insolvency process Before delving to understand the initiation process, you must be familiar with meaning of Corporate Debtor, Financial Creditor and Operation Creditor . Who Can Initiate Corporate Insolvency Resolution Process ? Section 6 of the act provides 3 p...

Meaning of Corporate Debtor, Financial Creditor, Operational Creditor under Insolvency and Bankruptcy Code.

Introduction We will explain 3 terms in this post Corporate debtor Financial Creditor Operational Creditor Corporate Debtor Corporate Debtor is company which owes money to others like Banks or investor etc. Section 3(8) of the Insolvency and Bankruptcy Code 2016 (Hereinafter referred as IBC) defines the Corporate Debtor as "Corporate Debtor" means a corporate person who owes a debt to any person. Financial Creditor These are banks or financial institution or rich individuals. They give loan and their relationship with Debtor is pure financial contract. " I give you loan, you return me with interest or some additional amount ". That's it. It also includes when loan by such bank is transferred or assigned to other bank or institution. When SBI gives a loan to company, they become Financial Creditor When LIC buys bods of a company, they become Financial Creditor. When you give loan to company when company says they will return you more money, you become financial ...

Bunkruptcy Trustee, appointment of Bankruptcy Trustee, Duties and Right of Bankruptcy trustee

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Introduction Firm and Individual don't see any growth and revival in business, and still have tons of loans to pay.   What would partnership firm/individual do when he is not able to serve this debt ? Well, they can do something which will clear all his debt, so that such businessman/partnership firm get discharge from legal obligation from paying back the loan. That something is bankruptcy. The person who manages lot of things during such process is Bankruptcy Trustee. In this Post we will cover below things: What is Bankruptcy Process Who is Bankruptcy Trustee  How is Bankruptcy Trustee Appointed Functions of Bankruptcy Trustee Rights of Bankruptcy Trustee Generally whoever will file for bankruptcy, his face will be like below. :)      What is Bankruptcy Process ? It's process. It's a legal Process wherein debts of debtor are discharged. This process also gives creditor some of their loan back by liquidating the asset...

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